Nortech Systems Incorporated (Nasdaq: NSYS), a leading provider of full-service electronics manufacturing services (EMS), today reported net sales of $27.4 million for the fourth quarter ended December 31, 2010, a 38 percent increase over net sales of $19.8 million for the fourth quarter of 2009. Operating income was $253,248 for the fourth quarter, compared with $8,456 for the fourth quarter of 2009. The company reported quarterly net income of $137,051, or $0.05 per diluted common share, in the fourth quarter of 2010, compared with a quarterly net loss of $145,347, or $0.05 per diluted common share, for the fourth quarter of 2009.

For the fiscal year ended December 31, 2010, the company reported net sales of $99.8 million, up 25 percent from $79.9 million reported for the 2009 fiscal year. Nortech Systems reported operating income of $1.2 million for the 2010 fiscal year, compared with an operating loss of $5.5 million for the 2009 fiscal year, which included one-time restructuring charges of approximately $1.0 million. Net income for the 2010 fiscal year was $507,000, or $0.18 per diluted common share. This compares with a 2009 fiscal year net loss of $3.8 million, or $1.40 per diluted common share, and $1.18 per diluted common share before one-time restructuring charges and related tax effect.

“We made significant progress in 2010 – growing sales, returning to profitability and expanding our capabilities with two strategic acquisitions,” said Mike Degen, Nortech Systems’ president and CEO. He added that sales growth was led by medical and industrial customers, who are demonstrating increased stability and confidence.

“Our improving financial performance was aided by our increased sales volume, lean manufacturing initiative and continued cost-containment measures,” explained Degen. “Global market factors are starting to increase prices on our key commodities – particularly copper and petroleum-based products – and we’re working to offset price fluctuations.” He said the EMS industry remains extremely competitive, with consolidations and excess capacity depressing prices.